Court Hears Oral Argument in Closely-Watched Yelp Defamation Case

Business owners and free speech advocates are anxiously awaiting a Virginia Supreme Court ruling in the Yelp, Inc., v. Hadeed Carpet Cleaning defamation case. In this matter, the owner of a carpet cleaning company sued seven anonymous parties who submitted negative reviews about his company on Yelp. Hadeed then sought to subpoena from Yelp information identifying these individuals. The lower court and the appeals court ordered Yelp to turn over the information. Yelp appealed the decision to the Virginia Supreme Court, which heard oral argument at the end of October.

The court’s decision must weigh the competing interests of the business in protecting its reputation versus the right to anonymous free speech. The case has garnered the interest of third party advocates, including social media entities. Google and others, including Facebook, Pinterest, and Twitter, have filed an amicus, or “friend of the court” brief, regarding their interests in protecting anonymous speech. These parties argued that the lower courts erred by failing to protect the First Amendment rights of anonymous online speakers.

Significantly, the Federal Trade Commission has received over 2,000 consumer complaints about Yelp since 2008. Most of the complaints are from business owners alleging that they received unfair or false reviews on Yelp. The interest in the Yelp decision signifies its importance in the quickly developing area of the law regarding on-line review websites. The court’s ruling is expected in early 2015.